Live ad insertion: the killer app for broadcasters?

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VoD services have had traditional broadcasters on the defensive, but can sophisticated ad insertion get linear viewing back on top. Paul Davies, communications manager at Yospace, gives us his take

After a turbulent few years for broadcasters and content providers, there are signs that the pieces are starting to fall into place for live and VOD streaming services. And it spells good news for viewers, advertisers and broadcasters alike.

The rush of viewers online has been so frantic over the last decade, with VOD services like Netflix transforming the way television is consumed, that there has been a growing fear amongst broadcasters that they will be left behind. Such was the rush to establish some kind of online presence that many initial deployments followed this pattern:

Hurry up and get a VOD service live

Find a way to monetise it

Think about user experience

For an industry that has built a reputation on the quality of its engineering by playing it slow and safe, there has been lot of trial and error. But there needed to be. The internet threatened to undermine the concept of broadcasting and, as the likes of Netflix and Amazon staked out their territory, all of a sudden it looked like there was less room for everybody else.

But now things are getting back into perspective. Broadcasters have discovered that they’ve held an ace card all along: live TV.

The concept of live television was deemed to be dying a slow death with the advent of VOD, but this doesn’t reflect actual viewing behaviour. Live television separates broadcasters from on demand providers like Netflix and it is unquestionably the domain of the broadcaster.

Event television has generated viewer demand for live services in the online domain. Sporting events are obviously big drivers of simultaneous audience engagement, but Saturday night is also a case in point: a quick look at Twitter during these periods will demonstrate how much viewers like the idea of everyone watching the same thing at the same time.

Broadcasters have added live streaming across their online platforms and, in doing so, they’ve discovered that live channels online are very popular — especially for live events, such as a major international sporting tournament where key fixtures are played out during the day, when the viewer often doesn’t have access to a television.

Opportunity to monetise

We have seen that viewers will watch a typical live programme from start to finish, a streaming session that may last for more than an hour. This makes inserting pre-roll ads very inefficient in terms of ads watched per content hour. Indeed, it also represents a fraction of what would be expected by broadcast television. Pre-roll is also incredibly frustrating to users.

In some territories, broadcasters are credited in their ratings for online views of the broadcast ad breaks, but streaming video tends to be a personal experience for the viewer. If they are watching on a mobile or tablet, for example, they have a one-on-one relationship with the screen, as opposed to the traditional TV that counts whoever is in the living room as its audience. As a result, there’s a huge opportunity to be able to cater content, including advertising, to the individual, which can be sold by broadcasters at a premium.

The most obvious approach to achieve this was to apply client-side ad insertion, as used already on their VOD services.

But this approach has drawbacks, including:

Heavy demands on the player lead to stream inconsistency

Added buffering while each advert loads

One bad video asset can break the stream

The software must be developed and maintained for each platform/device, which leads to inconsistent user experience across these platforms

With many such annoyances directly affecting the viewing experience, it shouldn’t be a surprise that users have been reaching for the ad blockers. Broadcasters, faced with the ongoing cost of maintaining multiple platforms, and potential brand damage for a poor user experience, have been rightly put off.

Broadcasters have discovered that they’ve held an ace card all along: live TV

Another way

Server-side offers the best user experience because it isn’t reliant on heavy lifting by the player. The viewer is delivered a single, continuous stream, regardless of platform/device, that is free from the tell-tale buffering that betrays the client-side approach.

For commercial broadcasters, a commitment to a linear streaming strategy also means a commitment to server-side ad insertion. That means integrating an ad technology provider with their streaming workflow in order to create an excellent user experience in which ad insertions are frame-accurate, seamless, and placed in a section of the stream where viewers expect adverts to be.

Channel 4 was the first UK broadcaster to offer a full catch-up TV service. The 4OD platform has been relaunched as All4 and now includes live streaming with ad replacement. Having collected user data, such as age and gender, at the point of registration for over 10 years, the insight it has into its audience places it in an enviable position. Other broadcasters have since realised the value in owning first-party data.

Despite the plethora of shows now available on catch-up, there is considerable evidence to suggest that there is a demand for a ‘lean-back’ viewing experience. Viewers are able to simply press play and lean back not having to curate their own content. This has an interesting effect on how many ads are watched through. Yospace customers consistently report watch-through rates of over 98% in their live streams – not just for sporting events, but regular linear television also.

The impact of server-side ad insertion on digital revenues has been so great in live streaming that broadcasters are starting to replace existing VOD solutions, too. The key workflow integrations are already in place so it’s a straightforward step.

It’s clear now that the concept of live TV is here to stay and that server-side ad insertion will become the standard, if it isn’t already. Broadcasters are masters of the live domain, and it is far from being under threat. By getting the technology right, and by getting the targeting right, their futures are looking very bright indeed.